Bitfinex Report Suggests Bitcoin Downtrend Could Persist: Analysts Warn of Long-Term Investor Profit-Taking
Bitcoin (BTC), the premier cryptocurrency, has maintained a stable range between $62,000 and $63,000 recently, leaving long-suffering investors hopeful for a substantial upturn. Yet, a disquieting report from Bitfinex analysts has surfaced that may unsettle these expectations.
According to The Block, Bitfinex analysts have observed a resurgence in profit-taking among long-term Bitcoin holders. This activity, they predict, could lead these investors to sell off portions of their holdings, exerting considerable downward pressure on BTC’s price in the short term.
“Long-term investors, who had refrained from realizing profits since early May, appear to have resumed profit-taking activities,” stated analysts. They further highlighted that despite BTC trading below the previous cycle peak of $69,000 in Q2 2024, these investors are now taking profits on a reduced scale.
The prospect of continued profit-taking by long-term holders raises concerns about Bitcoin’s near-term outlook, potentially prolonging its current decline and dampening medium-term bullish sentiment.
In addition to long-term investors’ actions, analysts noted other factors contributing to downward pressure on BTC’s price, including the German government’s Bitcoin sales and anticipated sales following Mt.Gox refunds. However, they also pointed out encouraging signs such as decreased miner sales and increased inflows into spot Bitcoin ETFs, which are bolstering BTC’s resilience.
Recent comments from Bitfinex analysts also underscored growing optimism in Bitcoin and other risky assets, citing unchanged data from the Personal Consumption Expenditure Index (PCE), a crucial inflation metric influencing Federal Reserve interest rate decisions.
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